Financial Business Act.pdf

While this translation was carried out by a professional translation agency, the text
is to be regarded as an unofficial translation based on the latest official Consolidated
Act no. 286 of 4 April 2006. Only the Danish document has legal validity.
October 2006, GlobalDenmark Translations
2) The substance of transaction rather than formalities without any real content must be
accounted for (substance over form).
3) All relevant matters must be included in the annual report unless they are insignificant
(materiality). But where several insignificant matters are deemed to be significant when
combined, they must be included.
4) The operation of an activity is based on a going concern assumption unless it is to be
discontinued or it is assumed that it will not be possible to be continued. If an activity is
discontinued, classification and presentation as well as recognition and measurement
must be adjusted accordingly.
5) Any change in value must be shown irrespective of the effect on the own funds and
income statement (neutrality).
6) Transactions, events and changes in value must be recognised when occurring
irrespective of the time of payment (accrual basis).
7) Methods of recognition and measurement basis must be applied uniformly to the same
category of matters (consistency).
8) Each transaction, event and change in value must be recognised and measured
individually, and individual matters must not be offset against each other (gross
presentation).
9) The opening balance sheet for the accounting year must be equivalent to the closing
balance sheet for the previous accounting year (formal consistency).
(2) Presentation and classification, method of consolidation, method of recognition and
measurement basis as well as the monetary unit applied must not be changed from period to
period (actual consistency). However, a change may be made if this results in a more true and
fair view being given, or if the change is necessary in order to comply with new regulations
issued pursuant to section 196.
(3) The provisions in subsection (1), nos. 6-9, and subsection (2) may be derogated from in
special cases. In such cases, section 186(3), 2nd clause shall apply correspondingly.
189.-(1) The assets and liabilities of financial undertakings shall, unless otherwise provided
for pursuant to section 196, be measured at fair value. Assets and liabilities shall be
depreciated and revalued in accordance herewith and depreciation and revaluation amounts
shall be included in the income statement unless otherwise specified pursuant to section 196.
(2) The fair value shall be determined as the market value of the relevant asset or liability on
a well-functioning market. Where such an asset or liability is not traded on a well-functioning
market, a recognised method shall be employed to calculate the fair value of the relevant asset
or liability.
190.-(1) Supplementary reports, for example reports on knowledge and know-how and
employee conditions (knowledge accounts), environmental issues (green accounts), the social
responsibility of the undertaking (social accounts), and ethical objectives and follow-up to
same of the undertaking (ethical accounts), shall give a true and fair view in accordance with
generally accepted guidelines for such reports. Such reports shall meet the quality
requirements in section 187(3) and the basic assumptions set out in section 188(1) and (2)
subject to the special terms required by the nature of the case.
EXCLUDING MINOR AMENDMENTS
(2) The methods and measurement basis used for the preparation of the supplementary
reports shall be disclosed in the reports.
191.-(1) The accounting year shall be the calendar year.